Asda to take a cautious approach to Black Friday 2015

The UK’s second biggest supermarket Asda is reportedly scaling back on its Black Friday discounts for 2015 after chaotic scenes last year. In 2014 bargain hungry shoppers were seen fighting as they battled to get their hands on heavily discounted items such as televisions, whilst the big discounts and extra staffing costs meant gains for the retailer were not as big as had been hoped.

Black Friday frenzy has gripped the UK in recent years as retailers have aimed to replicate the huge commercial success of the post Thanksgiving weekend in the US. Indeed it has become known as the biggest shopping day of the year due to the massive flash discounts offered on many high price items in the run up to Christmas.

Asda are owned by the US retail giant Walmart and have previously taken a full on approach to Black Friday but last year saw disappointing sales from the day of discounts, with little or no boost to their grocery sales produced by dropping prices on toys and electronics.

In a report published by trade journal Retail Week and picked up by the Guardian newspaper it is claimed that Asda will consider an online-only approach to discounting goods or will spread deals out over a period of several days in an attempt to avoid stampedes in stores.

Last year Asda is believed to have registered two million sales between 8am and mid-afternoon on Black Friday, giving them their busiest single trading day of the year to that point. However, a source quoted by the Guardian commented, “Last year big-ticket items sold at a loss and attempts to ensure safety by forcing shoppers to queue for items meant food sales tanked.”

This year many businesses are focusing their Black Friday strategy on online sales, yet this too requires careful planning and has the potential to backfire. In 2014 the online shops of a number of large retailers including Currys and Marks & Spencer struggled with demand.

Meanwhile in the run up to Black Friday retailers are unclear on what the day could bring, even if massive numbers of transactions are expected. Argos have issued a profit warning after investing heavily on advertising and logistics whilst being unsure of the level of sales activity to expect.

In addition John Lewis predict 2015 Black Friday sales will increase 20% on last year’s figures, but also believe that the heavy demand for special offers can later disrupt consumer spending and profitability in the run up to Christmas.

Figures from Experian-IMRG for 2014 showed that the total five-week period of Christmas shopping in the UK saw £4bn spent, with £810m of that on Black Friday, £720m on Cyber Monday and £702m on Boxing Day. For 2015 those figures are expected to rise to £1.07bn on Black Friday, £943m on Cyber Monday and £856m on Boxing Day, meaning a colossal overall spend of £4.9bn over the total five-week period.